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3 steps that lead nonprofits to financial reporting utopia

When one CFO at a private banking institution moved over to the nonprofit side, she knew some of the reporting requirements would be different—but she didn’t realize just how much higher the requirements around accountability would be. That’s probably a thought shared by every finance team member who used to work in the for-profit world and is now at a nonprofit, big or small.

Financial reporting at any organization can be intense, but complexity around grants and funding, greater board demands, and more skeletal finance teams can all make nonprofit reporting more taxing and intensive. Yet nonprofit teams of all sizes have found that it’s possible to achieve reporting utopia—if you take the right steps. Here’s how:

Step 1: Empower users beyond finance

Before Open Society Foundations implemented Adaptive Insights, people in the field who had budget or reporting questions would have to email one of the hub locations, then wait hours or even days for a response—and once they got that data, it was frequently stale. But the finance silo didn’t only impact field workers: Program staff often complained that the manual reports weren’t accurate or up-to-date, and so they didn’t trust the reports and weren’t engaged in the process. “We were in this vicious cycle,” says Kevin Hsieh, budget officer at Open Society Foundations.

What can finally break that cycle of distrust and inaccurate data is self-service reporting that’s incredibly intuitive to use. That means everyone from C-suite execs to program staff in the field to admin specialists can access financial reports in real time. Busting out of a silo frees the finance team from having to handle one-off queries and ad hoc reporting requests. And that greater access and transparency can also stoke more buy-in from people across the nonprofit, which helps drive even greater accuracy and nip variances in the bud.

Step 2: Make board reports a breeze

Nonprofit boards can be quite demanding. They might want a quick succession of reports, with updated data or prorated projections each time. Or they might request quick insights and more granular info around a particular KPI in a board report. Finance teams who are stuck using spreadsheets and manual data aggregation to respond to those requests can easily find that board reports dominate much of their time. “We’d often have to pull board reports multiple times, and with a manual process it was kind of a nightmare,” says Hsieh.

OfficeConnect is an easy, fast, and powerful way to solve that time sink and labor drain. The cloud-based tool allows finance teams to seamlessly generate board reports, so there’s no manual data entry or cross-checking involved. And you can update reports with the click of a button, because data can flow in and populate the format you’ve created, without the need for manual data entry or reformatting.

Step 3: Create a single source of truth

Staying current on funds utilization, program expenses, and budgets is a tough task when your nonprofit’s data is spread out across multiple systems and silos. There’s the issue of time when, say, you need to manually extract info from the financial ledger to update the budget. And there’s the issue of accuracy: When you spot an inconsistency—due to disparate data being updated on different timelines or a typo introduced during manual data entry—confidence in the numbers plummets, while time demands to root out that error can soar.

Creating a single source of truth that lives in the cloud solves for all of those problems. Data is updated in real time across all of your reports, budgets, and calculations, so you never have to worry that the nonprofit is making a strategic move based on outdated or inaccurate information. And because that data is updated automatically, the finance team won’t have to invest hours in manual data entry and verification. That would be welcome news at any organization, but it’s especially beneficial at nonprofits, where small finance teams are often tasked with handling more with fewer people. After implementing Adaptive Insights, “we weren’t having to deal with Excel files floating around,” says Hsieh. “It was all a single source of truth.”

Finance teams at nonprofit organizations face great demands—and high stakes. You want to help ensure the organization is living up to its mission and having the greatest impact possible, and part of that is streamlining finances and cultivating as much collaboration as you can. Creating reporting utopia doesn’t have to happen overnight (Open Society Foundations made the choice to take an iterative approach and is still making improvements today), but a change in the right direction means more time and resources that can be spent on meaningful, strategic tasks that tie directly to your core mission.

Kevin is focused on having all levels of the organizations engaged and involved in the financial planning process by leveraging cloud finance software to create an easily-accessible, easy-to-understand reporting environment. He is a budget officer for the Open Society Foundations.

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